The Real NAFTA Problem Is With Canada, Not Mexico, Ryan Says

Morneau emphasized the need to work harder to come to an agreement on a renewed NAFTA, although he too said he's prepared for any scenario.

The Canadian dollar was little changed against its US counterpart on Friday as the greenback broadly fell and the price of oil pared some recent gains, while investors awaited an interest rate decision from the Bank of Canada next week.

Roberts told TWS he warned Trump that getting rid of NAFTA would send shivers throughout the entire farm economy, "and I think we'd see an immediate response in the stock market".

While a NAFTA termination letter would start the six-month exit clock ticking, the United States would not be legally bound to quit NAFTA once it expires.

The comments cast further doubt on prospects for talks to modernize the trilateral North American Free Trade Agreement (NAFTA), which Trump has repeatedly threatened to abandon unless major changes are made.

But a senior Canadian government official said the idea that NAFTA is in trouble because of two chapters out of the 28 being negotiated is "total nonsense".

Sources said some of the Canadian proposals related to autos content, an area where Mexico has recently indicated there might be room for compromise.

Foreign Affairs Minister Chrystia Freeland said at a Liberal cabinet retreat in London, Ont., that Trump's newfound patience on NAFTA renegotiations is "sensible" and "constructive".

While the USA has been clear there was a possibility it would withdraw from the agreement, Canadian officials believe a positive outcome is possible "if there is goodwill on all sides", Foreign Affairs Minister Chrystia Freeland told reporters Thursday.

"They're getting smarter on this", Donohue said of the White House's trade strategy.

Saskatchewan's economy is heavily dependent on trade, especially with the U.S. In 2016, the province's total exports to the U.S. totalled $12.8 billion - 47 per cent of all exports.

But while Champagne was talking tough, Freeland said she remains hopeful a new NAFTA deal beneficial to all three countries can be reached.

Scrapping NAFTA would not only damage GOP campaign plans, but it would also be likely to set off a fierce legal battle over whether or not Trump has the unilateral authority to make the decision without congressional approval.